|
Retirement Plans Newsletter January 18, 2021 |
|
|
||||||||||||
|
Newly Posted |
||||||||||||
|
Discussions |
||||||||||||
|
This Newsletter:
BenefitsLink Health & Welfare Plans Newsletter:
Message Boards Digest:
|
|
[Official Guidance]
"For purposes of determining covered compensation for the 2021 year, the taxable wage base is $142,800. The following tables provide covered compensation for 2021." Internal Revenue Service [IRS] |
|
[Guidance Overview]
"The guidance includes 'best practices' for retirement plan fiduciaries, compliance assistance to EBSA Regional Offices under the Terminated Vested Participants Project (so-called 'missing participant' audits), and temporary enforcement relief for terminated defined contribution plans and abandoned individual account plans that use the PBGC Missing Participant Program. While this DOL 'missing participant'
guidance has been long-awaited, as sub-regulatory guidance, it is all subject to change without notice and comment." Miller & Chevalier |
||
|
[Guidance Overview]
"Sponsors have raised privacy concerns relating to a number of [the listed] strategies. DOL acknowledges these concerns and generally recommends ... asking the relevant parties (e.g., beneficiaries, other related plans) to forward letters to the missing participants.... DOL notes that not all of the listed strategies will be appropriate or necessary for every plan. Also, DOL states that fiduciaries can consider 'the size of a participant's accrued benefit and account balance as well as the cost of search efforts.' ... [It] seems probable that evidence of [a] written policy will be required in DOL investigations and similar settings." Eversheds Sutherland |
||
|
[Guidance Overview]
"Employers can avoid a 2020 partial plan termination by increasing participant counts by March 31, 2021.... The Qualified Disaster provisions in the CAA are optional.... Plan sponsors of multiemployer plans in the building and constructions industry may allow in-service distributions at or after age 55." Nelson Mullins |
||
"Retirement researchers recently have been touting the benefits of a so-called bridge strategy, whereby retirees front-load withdrawals from 401(k) plans and individual retirement accounts to delay claiming Social Security. For each year that a person delays claiming up to age 70, his monthly Social Security check goes up 7% to 8%.... This new idea ... calls on 401(k) plan sponsors to introduce a default 'bridge fund' into 401(k) plans that would use fund assets to deliver automatic monthly payments to anyone who retires in their 60s at a level equivalent to the monthly Social Security benefits that seniors would receive at full retirement age." Barron's |
||
|
Benefits in General |
||
42 pages. "[T]he Council recommends that the [DOL] highlight the issue of the risks to individuals resulting from diminished mental capacity, including potential financial exploitation, including: [1] As part of the Department's outreach and education programs, provide general public education ... [2] Publish information ... on the topic, with a focus on ... best practices recommended by the financial services industry ... [3] Issue guidance that recognizes that fiduciaries may voluntarily adopt policies or procedures that: (a) impose reasonable temporary restrictions on participant plan actions ... when participants exhibit signs of diminished capacity or financial exploitation, and/or (b) encourage actions by participants such as the identification of a 'trusted contact,' require confirmation of a Power of Attorney
authorization's continuing effectiveness, or take other reasonable steps ... to protect participants from potential fraud and financial abuse." Advisory Council on Employee Welfare and Pension Benefit Plans, Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL] |
||
|
Executive Compensation |
||
|
[Guidance Overview]
"The substantive changes contained in the final regulations generally are limited to expanding the nonexempt funds exception to the definition of covered employees. In addition, the final regulations add a number of examples to clarify provisions originally included in the proposed regulations." RSM US |
||
|
[Guidance Overview]
"[To] provide more flexibility in cases where an employee may unexpectedly fail to meet the 50% threshold in an applicable year, [the final regulations] expand the measurement period for the non-exempt funds exception from one applicable year to two applicable years ... The final regulations adopt the definition of ATEO set forth in the proposed regulations." Thomson Reuters Practical Law |
||
64 pages. "[T]he Council recommends that the Department: [1] Require that top hat plan sponsors notify eligible participants of the risks associated with the absence of ERISA's substantive protections ... [2] Revise the alternative reporting regime for top hat plans to: Require reporting every 3 years or, if earlier, upon ceasing to cover any employees; [and] Include, at a minimum, [specified] data elements ... [3] Issue a Request for Information seeking comments from interested stakeholders on possible regulatory definitions of a 'select group of management or highly compensated employees,' including possible bright-line definitions and/or safe harbor/unsafe harbor definitions." Advisory Council on Employee Welfare and Pension Benefit Plans, Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL] |
||
|
Selected Discussions |
||
|
► It's easy to sign up and participate in discussions! Post answers, ask questions, create custom feeds and views. Join your peers (and potential referral sources or customers)—there is no charge. |
||
"Would this be an acceptable formula for SH QACA Match? 200% on first 1% and 50% on next 5%." BenefitsLink Message Boards |
||
|
► Subscribe to the BenefitsLink Message Boards Digest -- a free daily email of all new discussions (not just the selected few shown above). View a sample issue. |
||
|
Press Releases |
||
|
NCEO Captive Insurance Program Will Launch This Summer
|
||
|
Most Popular Items in the Previous Issue |
||
|
DOL Issues Guidance on Searching for Missing Participants
|
||
|
DOL Issues Missing Participant Guidance for Retirement Plans
|
||
BenefitsLink.com, Inc.
<
(407) 644-4146
Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager
BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2021 BenefitsLink.com, Inc. All materials contained in this newsletter are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of BenefitsLink.com, Inc., or in the case of third party materials, the owner of those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.
Links to web sites other than BenefitsLink.com and EmployeeBenefitsJobs.com are offered as a service to our readers; we were not involved in their production and are not responsible for their content.